A lot of people are approaching their retirement years in Bergen County NJ and are finding they can't be financially secure with the amount of money they have saved. They may have had unforeseen medical expenses, or maybe they experienced a catastrophic drop in their 401K's or IRA accounts as a result of the financial crisis. Many homeowners who have ended up in this scenario may be in a position to secure a reverse mortgage, which will permit them to tap into the equity in their homes.
Bergen County NJ - What Reverse Mortgages Choices Are Available
Homeowners over the age of 61 may have the option of choosing between several types of reverse mortgages, determined by their requirements and circumstances:
* Single purpose reverse mortgages are offered by nonprofit agencies, as well as local and state governments. This type of reverse mortgage is intended to provide for low to moderate-income seniors who require money to take care of a specific expense, including major home repairs or property taxes. Even though only a limited amount of funds are available with the use of this type of reverse mortgage to the homeowner, the costs associated with the mortgage are usually substantially less than the other types of reverse mortgages.
*The Department of Housing and Urban Development administers reverse mortgages which are insured by the federal government called Home Equity Conversion Mortgages (HECM). The homeowner is required to sit down with an authorized housing counselor, however, before applying for this kind of mortgage. The fees and costs of the loan will be reviewed with the prospective borrower by the counselor on top of exploring other funding options which may be available.
* Homeowners whose homes have a high value and a considerable amount of equity can take advantage of proprietary reverse mortgages, which are available through non-public lenders.
The amount an individual or couple can borrow is determined by age of the homeowners, the amount of equity in the home, and the type of mortgage they choose. A homeowner can choose to get the payments all at once, on a term basis, or on a tenure plan once approved for a HECM or proprietary reverse mortgage. Social Security and Medicare payments are not affected by this as they are tax-free.
Bergen County NJ - What Reverse Mortgages Choices Are Available
Homeowners over the age of 61 may have the option of choosing between several types of reverse mortgages, determined by their requirements and circumstances:
* Single purpose reverse mortgages are offered by nonprofit agencies, as well as local and state governments. This type of reverse mortgage is intended to provide for low to moderate-income seniors who require money to take care of a specific expense, including major home repairs or property taxes. Even though only a limited amount of funds are available with the use of this type of reverse mortgage to the homeowner, the costs associated with the mortgage are usually substantially less than the other types of reverse mortgages.
*The Department of Housing and Urban Development administers reverse mortgages which are insured by the federal government called Home Equity Conversion Mortgages (HECM). The homeowner is required to sit down with an authorized housing counselor, however, before applying for this kind of mortgage. The fees and costs of the loan will be reviewed with the prospective borrower by the counselor on top of exploring other funding options which may be available.
* Homeowners whose homes have a high value and a considerable amount of equity can take advantage of proprietary reverse mortgages, which are available through non-public lenders.
The amount an individual or couple can borrow is determined by age of the homeowners, the amount of equity in the home, and the type of mortgage they choose. A homeowner can choose to get the payments all at once, on a term basis, or on a tenure plan once approved for a HECM or proprietary reverse mortgage. Social Security and Medicare payments are not affected by this as they are tax-free.
About the Author:
Erick Brucker is a blogger on topics related to mortgage choices for homeowners. Click here to learn more!
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